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For a long time the Nehemiah program has helped large numbers of borrowers obtain a first home through the FHA program. With Nehemiah, a seller gives the nonprofit group a contribution of up to 6 percent of the sale price.

Nehemiah does not provide any gift money to pay off credit cards, auto debts or whatever. Indeed, the program is liked by just about everyone — except HUD.

HUD is now asking for comments on a proposal that would effectively gut the Nehemiah program.

In response, Scott C. Syphax, President and CEO of Nehemiah Corporation of America, has written a thoughtful and interesting op-ed piece that I found in the Louisiana Weekly. The entire article is well worth reading, but allow me to quote some of the highlights:

“As of June 2007, National Homeownership Month, the Nehemiah Program will have helped more than 229,000 families purchase their first homes across every state in the country and has given out almost $900 million in grants without receiving a single dime from either government or foundations. Nehemiah created a model where its down payment assistance comes from revolving funds constantly replenished by contributions from the realtors, lenders, and private home sellers across the country.”

Also:

“While some imitators of Nehemiah have engaged in practices that deserve increased regulation and oversight –which Nehemiah supports and advocates –the federal government is pushing an agenda which instead “mends it don’t end it” seeks to absolutely ban a model that has helped so many.

“Unlike the sub-prime loans that are currently under scrutiny because of terms and practices that take advantage of low income homebuyers, 98 percent of Nehemiah grant families receive their loans combined with FHA insurance ensuring that the loans meet the Federal Government’s requirements for fairness.”

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